HONG KONG – Fitch Ratings has upgraded Ghana’s Long-Term Foreign-Currency Issuer Default Rating (IDR) to ‘B-‘ from ‘Restricted Default’ (RD), assigning a Stable Outlook. The upgrade, announced on June 16, 2025, reflects Fitch’s assessment that Ghana has normalized relations with a significant majority of its external commercial creditors following the restructuring of USD13.1 billion in Eurobonds in October 2024.
While approximately USD2.6 billion of non-performing external debt remains to be restructured, Fitch categorizes only USD700 million of this as commercial debt, representing a mere 5% of the initial external commercial debt included in the restructuring perimeter.
Fitch anticipates that ongoing negotiations with these outstanding commercial creditors will successfully conclude, with holdout risks assessed as small.
The ratings agency expects Ghana to fully complete its external debt restructuring by the end of 2025, having already ratified a memorandum of understanding on the restructuring of USD5.1 billion in bilateral official debt in January 2025.
Fitch noted that Ghana’s primary fiscal deficit widened to 3.9% of GDP in 2024, attributed to typical fiscal slippage in election years, but projects a primary surplus of 0.5% in 2025 and 0.9% in 2026. Overall deficits are forecast to decline to 3.6% in 2025 and 3.2% in 2026 from 7.9% in 2024.
The report highlights manageable foreign-currency-denominated debt service obligations, forecasted at 1.2% of GDP in 2025, supported by a rebound in unencumbered international reserves.
Public debt is projected to fall significantly to 60% of GDP in both 2025 and 2026, down from 72% in 2024 and a peak of 93% in 2022. This reduction is attributed to strong nominal GDP growth, fiscal consolidation, and significant cedi appreciation.
Fitch also forecasts Ghana’s current account surplus, which hit a record 4.3% of GDP in 2024, to narrow but remain positive at 1.1% by 2026, enabling continued reserve accumulation.
Inflation is expected to decline to an average of 15% in 2025 and 10% in 2026, aided by cedi appreciation, tight monetary policy, and fiscal consolidation, with the Bank of Ghana expected to begin cutting its policy rate in July 2025. Real GDP growth has remained resilient, recorded at 5.7% in 2024, and is projected to stay solid at 4% in 2025 and 4.5% in 2026, driven by a rebound in agriculture and continued expansion in industrial and services sectors.
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